Originally Posted by
sk8uno
The question wasn't about who loses money on VR in general, the question was about who loses money on VR when someone uses it to "cycle" money vs. pay "legitimate" expenses. Setho212 indicated that cycling money causes one of the companies to lose money. My point is that the transactions have the same result regardless of how you dispose of the money.
I am also skeptical that CVS loses money. VRs just don't strike me as a very good loss leader. I wouldn't be surprised if the relationship between CVS and the gift card companies was more like a landlord-tenant relationship, with CVS essentially renting out store space for the displays.
+1. Most of these drugstores sell candy bars for a $1 or two. I think you can easily put 15 cards in the same space as two candy bars for almost $60 in sales as opposed to $2-4. And if they were true loss leaders, I think they'd be in the display aisle as soon as you enter the store. These cards, as others, get a prominent display position at the end of an aisle, but you generally have to walk six or seven intersecting aisles into the store to find them.